Is news of the acquisition true?
The news has been making rounds that Uber will be acquiring Careem soon. The news is authentic and both the ride hailing companies have reached an agreement whereby Uber is all set to acquire Careem by the first quarter of 2020.
Uber is acquiring Careem for $3.1 billion. Uber will pay $1.4 billion in cash whereas $1.7 billion will be paid in convertible notes.
How will Uber & Careem operate after acquisition?
Uber is to acquire the Careem’s mobility, delivery, and payments businesses across the greater Middle East region. This region ranges from Morocco to Pakistan. The major operational markets of the ride-hailing companies would be Egypt, Jordan, Pakistan, Saudi Arabia, and the United Arab Emirates.
Once the entire acquisition takes place, Careem will become a wholly-owned subsidiary of Uber. This will however allow Careem to maintain its own brand name. Also, Careem’s businesses would be led by Mudassir Sheikha. Sheikha is the founder and CEO of Careem who originally hails from Karachi, Pakistan.
Having said that, Careem and Uber are to operate as independent brands operating in their respective regions.
How will employees be affected from this acquisition?
Now, experts are of view that almost 300 Careem employees would become millionaires due to this acquisition. According to the news by The National, 200 of the Careem employees will become Dirham millionaires whereas 75 will become dollar millionaires.
This is because all the Careem employees have stock option. Now, as the company’s stocks are being bought, their net-worth and stocks will increase automatically.
There are 4000 Careem employees who have a stock option, which means that with the acquisition of their company they will become millionaires. These 4000 employees include executives, developers, engineers, R&D professionals working across operational regions. The Careem captains are the ones who do not form part of the stock.
Employees that will benefit the most
While it is known that the net worth of Careem executives: Mudassir Sheikha, Magnus Olsson, and Abdulla Elyas will be skyrocketing, here are names of few others who would benefit most from this acquisition:
- Ankur Shah, Chief Finance and Development Officer
- Fatima Mazhar, Early Stage Markets Director
- Hadeer Shalaby, Co-Founder Taxi El Sa7el acquired by Careem, now Regional Director of Careem Bus
- Junaid Iqbal, Managing Director for Pakistan and Saudi Arabia
- Ibrahim Manna, Managing Director for Emerging Markets
- Bassel Al Nahlaoui, Managing Director for Gulf
- Madeeha Hassan, Founder of Savaree, acquihired by Careem, now Product Manager of Careem
- Sandeep Shetty, Managing Director & SVP – Ride Hailing Department
The Positive effects of the acquisition
First, they are of view that creation of such organizations itself has been revolutionary as they had created multiple job opportunities, captured market through efforts, created new business models and provided safe and secure services while keeping R&D as a basic tool. They have created what we can call an exemplary work culture.
Now, with the injection of $3.1 billion in the economy, ripple effects will be observed in the coming years. First, Careem and Uber themselves have become an epitome of success inspiring others to innovate. They are being a source of inspiration and light for entrepreneurs around the world.
So, with more than 300 millionaires in the economy within few years, we will be seeing array of investment, new businesses and innovations.